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Vat registered companies.... how do you stay competitive

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11 hours ago, Philip Anderson said:

I’m not sure on your thinking here when I price a job I quote the price I need on it or want for doing it plus vat which never comes into the equation as it’s not mine technically (the vat).wether a client or firm I quoting for us vat registered or not is irrelevant.

 My thinking is that the non vat company will charge the commercial client £500. The vat reg company will be the same cost to the client at £500 plus vat.

 

So in this case the vat reg co has the advantage as they theoretically have lower costs as they claim the vat back..  it might not be a lot... but as bob said earlier helps reduce that 20 percent perceived additional  cost by being vat reg.. 

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4 minutes ago, benedmonds said:

 My thinking is that the non vat company will charge the commercial client £500. The vat reg company will be the same cost to the client at £500 plus vat.

 

So in this case the vat reg co has the advantage as they theoretically have lower costs as they claim the vat back..  it might not be a lot... but as bob said earlier helps reduce that 20 percent perceived additional  cost by being vat reg.. 

Huhh? Doesn’t make any sense.

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6 hours ago, Alycidon said:

Dont think Sage software will allow this.   Dont forget that the new making tax digital scheme coming in (next year ?) initially for corporation tax  requires HMRC compatible software.   My Sage 50 because its no longer supported by Sage ( 6 years old ) is now no longer acceptable so I have to upgrade.  

 

A

Personally, I would not touch Sage with a 10' barge pole. IMHO it is THE most overrated piece of software.

I am Mac based as are many of my clients and find that Account Edge (formerly MindYourOwnBusiness see here.... https://www.visma.co.uk/accountedge ) is much more user friendly than Sage.

It is a simple system (that produces cash based Vat returns at the press of button) but it has a number of sophisticated features that can be used if needed and I have yet to come across a service or manufacturing business with  needs that cannot be met by it.

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1 minute ago, Mick Dempsey said:

 

Huhh? Doesn’t make any sense.

Not to you maybe..

 

The op. Thought  going vat reg adds 20 percent to your rates (to domestics) therefore makes you uncompetitive.. the point I was trying to make is that to commercial clients it can actually make you more competative as your costs are lower..

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17 minutes ago, benedmonds said:

 My thinking is that the non vat company will charge the commercial client £500. The vat reg company will be the same cost to the client at £500 plus vat.

 

This bit doesn’t make sense, ah hang on see what you mean. Carry on.

Edited by Mick Dempsey

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15 minutes ago, benedmonds said:

Not to you maybe..

 

The op. Thought  going vat reg adds 20 percent to your rates (to domestics) therefore makes you uncompetitive.. the point I was trying to make is that to commercial clients it can actually make you more competative as your costs are lower..

You’d have to be working on some pretty suicidal margins to be faffing around considering the VATable rebate on input consumables when calculating the overall profitability (or otherwise) of a task. 

 

 

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12 minutes ago, kevinjohnsonmbe said:

You’d have to be working on some pretty suicidal margins to be faffing around considering the VATable rebate on input consumables when calculating the overall profitability (or otherwise) of a task. 

 

 

I am not proposing working it out. Just that being VAT registered is not commercial suicide..

And the 20 percent is in reality somewhat less..

 

 

Edited by benedmonds

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